HB2254 - Relating to certain health care services contract arrangements entered into by insurers and health care providers.

      H.B. No. 2254         AN ACT   relating to certain health care services contract arrangements   entered into by insurers and health care providers.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Subchapter A, Chapter 1301, Insurance Code, is   amended by adding Section 1301.0065 to read as follows:           Sec.   1301.0065.     VALUE-BASED AND CAPITATED PAYMENT   ARRANGEMENTS WITH PRIMARY CARE PHYSICIANS OR PRIMARY CARE PHYSICIAN   GROUPS NOT PROHIBITED. (a) In this section:                 (1)     "Primary care physician"   means a specialist in   family medicine, general internal medicine, or general pediatrics   who provides definitive care to the undifferentiated patient at the   point of first contact and takes continuing responsibility for   providing the patient's comprehensive care, which may include   chronic, preventive, and acute care.                 (2)     "Primary care physician group" means an entity   through which two or more primary care physicians deliver health   care to the public through the practice of medicine on a regular   basis and that is:                       (A)     owned and operated by two or more physicians;   or                       (B)     a freestanding clinic, center, or office of a   nonprofit health organization certified by the Texas Medical Board   under Section 162.001(b), Occupations Code, that complies with the   requirements of Chapter 162, Occupations Code.           (b)     A preferred provider benefit plan or an exclusive   provider benefit plan may provide or arrange for primary health   care services with a primary care physician or primary care   physician group through a contract for compensation under:                 (1)  a fee-for-service arrangement;                 (2)  a risk-sharing arrangement;                 (3)     a capitation arrangement under which a fixed   predetermined payment is made in exchange for the provision of, or   for the arrangement to provide and the guaranty of the provision of,   a contractually defined set of covered services to covered persons   for a specified period without regard to the quantity of services   actually provided; or                 (4)     any combination of arrangements described by   Subdivisions (1) through (3).           (c)     A primary care physician or primary care physician group   that enters into a contract described by Subsection (b) is not   considered to be engaging in the business of insurance.           (d)     A primary care physician or primary care physician group   is not required to enter into a payment arrangement under this   section, and an insurer may not discriminate against a physician or   physician group that elects not to participate in an arrangement   under this section, including by:                 (1)     reducing the fee schedule of a physician or   physician group because the physician or physician group does not   participate in the insurer's value-based or capitated payment   arrangement or other payment arrangement provided under this   section; or                 (2)     requiring a physician or physician group to   participate in the insurer's value-based or capitated payment   arrangement or other payment arrangement provided under this   section as a condition of participation in the insurer's provider   network.           (e)     A primary care physician or primary care physician group   may file a complaint with the department if the physician or   physician group believes the physician or physician group has been   discriminated against in violation of Subsection (d).           (f)     A contract allowing for a value-based or capitated   payment arrangement or other payment arrangement provided under   this section:                 (1)     may not create a disincentive to the provision of   medically necessary health care services and may not interfere with   the physician's independent medical judgment on which services are   medically appropriate or medically necessary;                 (2)  must specify:                       (A)     in writing if compensation is being paid   based on satisfaction of performance measures and, if so,   specifically provide:                             (i)  the performance measures;                             (ii)  the source of the measures;                             (iii)     the method and time period for   calculating whether the performance measures have been satisfied;                             (iv)     access to financial and   performance-based information used to determine whether the   physician met those measures; and                             (v)     the method by which the physician may   request reconsideration;                       (B)     that the attribution process will assign a   patient to:                             (i)     first the patient's established   physician, as determined by a prior annual exam or other office   visits; and                             (ii)     if no established physician   relationship exists, then a physician chosen by the patient;                       (C)     if payment involves capitation, whether a   bridge rate, such as a discounted fee for service, will remain in   effect for a certain period until sufficient data has been   generated regarding utilization to allow an insurer to make an   informed decision regarding fully capitated rates;                       (D)     whether the capitated rate, if any, will   provide for a stop-loss threshold or a guaranteed minimum level of   payment per month, and whether the physician will obtain stop-loss   coverage; and                       (E)     whether payment will take into account   patients who are added to or eliminated from the attributed   population during the course of a measurement period;                 (3)     if payment involves capitation, must provide for   the opportunity to renegotiate in good faith a revised capitation   rate, or reimburse on a fee-for-service basis under a contractual   fee schedule until a revised capitation rate is agreed to if there   is a material increase in the scope of services provided by the   physician or a material change by the payer in the benefit   structure; and                 (4)  must state:                       (A)     whether catastrophic events are excluded   from the final cost calculation for an attributed population when   compared to the cost target for the measurement period, if   applicable; and                       (B)     if payment involves shared savings, whether   the entire savings is shared when the minimum savings rate is   reached, or whether only the amount in excess of the minimum savings   rate is shared.           (g)     This section does not authorize a preferred provider   benefit plan or an exclusive provider benefit plan to provide or   arrange for health care services with a primary care physician or   primary care physician group through a contract for compensation   under a global capitation arrangement.           (h)     The parties to a contract under Subsection (b) are the   primary care physician or primary care physician group and the   preferred provider benefit plan or exclusive provider benefit plan.     A party to a contract under Subsection (b) may not subcontract.          SECTION 2.  This Act takes effect immediately if it receives   a vote of two-thirds of all the members elected to each house, as   provided by Section 39, Article III, Texas Constitution.  If this   Act does not receive the vote necessary for immediate effect, this   Act takes effect September 1, 2025.       ______________________________ ______________________________      President of the Senate Speaker of the House                   I certify that H.B. No. 2254 was passed by the House on May 1,   2025, by the following vote:  Yeas 144, Nays 0, 1 present, not   voting.     ______________________________   Chief Clerk of the House                 I certify that H.B. No. 2254 was passed by the Senate on May   21, 2025, by the following vote:  Yeas 31, Nays 0.     ______________________________   Secretary of the Senate       APPROVED:  _____________________                      Date                           _____________________                    Governor